Brian Lenihan has let himself down. The Minister for Finance is one of the few government politicians who still attract some public goodwill, mainly because his impressive communication skills make him sound like a man who knows what he's doing.
With his inept handling of the AIB bonus scandal, however, he has forfeited much of that goodwill -- and also lost vital ground in the race to be the next leader of Fianna Fail.
Where did it all go wrong? Lenihan's fundamental mistake was his failure to realise that paying bonuses of €40m to AIB staff would cause such a public outrage. Even after this newspaper exposed what was going on last week, he spent several days trying to do a Pontius Pilate by claiming there was nothing he could do.
In fact, AIB's excuse that the court had tied their hands was obviously nonsense. Since the bank can only stay afloat because the public has bailed it out to the tune of €3.5bn (with lots more to come), it could obviously have pleaded an inability to pay -- and as the man who withdrew the Christmas bonus for social welfare recipients, Lenihan should have understood that better than anyone. Not only does his initial reluctance to intervene show a disappointing lack of regard for taxpayers' money, it also puts a huge question mark against the minister's own political judgement.
To his credit, Lenihan has finally decided to play hardball by telling AIB it can forget about receiving any more public money if those bonuses are paid. Since 91 employees have already declared their intention to sue, however, we don't yet know whether this move will do the trick. Either way, the controversy should never have blown up in the first place -- and the minister must take a huge chunk of the blame for failing to act much sooner.
Since then, it's turned out that Lenihan can't even prevent this scandalous bonus culture from running riot under his own nose. Dozens of civil servants have received salary top-ups over the last year, including almost 100 extra payments to officials in the Department of Finance. Since this is the department whose tax and growth predictions for the last several years turned out to be wildly over-optimistic, perhaps we shouldn't be surprised to discover they're so generous about rewarding themselves with public cash.
If Lenihan wants to reinvent himself as the taxpayers' champion, there are plenty of more radical decisions he could make straight away. He should recognise that AIB's corporate culture is completely rotten by sacking the entire board and forcing all senior executives to re-apply for their jobs. He should pass a law to ensure that any future bonuses or salary increases must be personally approved by the minister, hardly an extravagant request given that the bank will soon be 99pc state-owned anyway.
Above all, he should stand up to the international bondholders in exactly the same way -- making it clear that we cannot be expected to pay the full price for their gambling mistakes. Instead, it seems that Lenihan is busy auditioning for the role of leader of the opposition even while FF are still in power. This week he has slammed the social partnership model for its role in our economic woes, even though his own party constructed it in the first place. He has also criticised previous FF governments for over-inflating the property market, a luxury he can afford since he didn't join the cabinet until 2007.
Despite this clear positioning for the coming FF leadership election, a source close to the Taoiseach claims that Lenihan's star is "dropping like a meteorite". He has been badly damaged by his shiftiness over the EU/IMF bailout, which he continued to deny until the last possible minute. His budget will make it through the Dail, but those savage cuts to carers, blind people and the disabled will not be easily forgotten. Most FF TDs still feel that Lenihan's heart is in the right place. If Brian Cowen stands down over the Christmas holidays, then the Minister for Finance would have a good chance of succeeding him. If the Taoiseach stays on until next year's election, however, Micheal Martin will become the overwhelming favourite -- on the grounds that his smooth personality makes him better equipped to get on the rubber chicken circuit and rebuild the party from the grassroots up.
Brian Lenihan has just a few weeks left in the Department of Finance. He would be well advised to make the most of them -- because right now, his performance can only be described as hugely disappointing.